ASIC chair Sarah Court says the regulator wants to see compensation for thousands of investors that lost millions because Diversa allowed First Guardian to sit in its platform.
ASIC is taking legal action against Diversa for alleged due diligence failures.
Diversa is fighting the legal action, arguing that the losses were due to alleged fraud.
ASIC chair Sarah Court says evidence given by Diversa at the hearing earlier this morning that the losses that investors experienced were due to alleged fraud misses the point.
"The point is that if you are a super trustee, you are in a special position of trust ... and must act in those members' interests."
She says ASIC's view is that there would be no opportunity for fraud to happen if the trustee had not put First Guardian on its platform.
ASIC is suing Diversa over alleged due diligence failures.
She says Diversa is being investigated by ASIC and that this should not be misconstrued as the super platform "working with ASIC".
ASIC will give update on audit of whistleblower complaints by year's end.
Diversa executive director Andrew Peterson received a controversial cash bonus of $777,399 (part of a total $1.7 million remuneration package) for the 2025 financial year.
Diversa is being questioned about why the executive was awarded the bonus when thousands of First Guardian investors lost millions because Diversa allowed its investments to sit on their platform.
Diversa chair Vincent Plant answered that he thought the bonus was deserved and he has confidence in Mr Peterson's performance.
Senators and spectators audibly scoffed at the response superannuation trustee Diversa gave during a Senate inquiry looking into how it allowed its customers’ money to be lost in the First Guardian Master Fund collapse.
Senator Paul Scarr criticised Diversa's opening statement on Friday morning at the Joint Committee on Corporations and Financial Services, which made "no mention" of a $240 million lawsuit ASIC had launched against the business or the fact that it still made bonus payments to executives.
"What confidence can members have that their funds are safe?" Senator Scarr asked.
Diversa's chair, Vincent Plant, said customers should have "a high level of confidence", which caused Senator Scarr to scoff and attendees to audibly guffaw.
Chair of the Parliamentary Committee, senator Deborah O'Neill, questioned how Mr Plant could make that statement "in all honesty" given the situation.
Mr Plant said that Diversa couldn't have predicted the fraud within First Guardian and added, "We're not clairvoyant."
"We’re not asking you to predict it, [you should] protect against it!" Senator O'Neill fired back.
It followed another heated exchange between Senator O'Neill and Diversa's general counsel Simon Stainstreet within minutes of the hearing kicking off.
She accused Diversa of "frustrating" ASIC's efforts by using legal and professional privilege to withhold documents requested in the corporate regulator's investigation.
Mr Stainstreet said "I don’t agree", and said "legal professional privilege is a right and we’re exercising that right where it complies."
Diversa is still arguing that it was a victim of third-party fraud rather than its own negligence.
Diversa independent chair Vincent Plant told the hearing they could not have predicted fraud.
"We're not clairvoyants," he told the hearing.
"Diversa had nothing to do with the actual fraud, the fraud was committed by Falcon Capital [responsible entity for the First Guardian master fund]."
Senator Scarr reminded Diversa that as a super trustee, it had obligations to investors to ensure the investments listed on their platforms were suitable.
Diversa says it will spend north of $2 million to fight ASIC's legal action.
This is in contrast to Macquarie and Netwealth, which settled with the regulator over alleged due diligence failures in relation to the Shield and First Guardian funds.
Of the total $480 million worth of investments made in Shield, Macquarie reimbursed $321 million to 3,000 investors.
And Netwealth reimbursed about $100 million to about 1,000 First Guardian investors.
Senator Deborah O'Neill is firing off at Diversa representatives at the hearing over their alleged due diligence failures for allowing First Guardian investments to sit on their super platform.
In questions to Diversia, Senator O'Neill asked: "The person selling you the product tells you 'it's all hunky dory ... fantastic looks fine, let's rake some money in. SQM says it's good'. You list it. Let it rip. All profit. No responsibility. That's what it looks like to me."
Diversia has argued it relied on the research house SQM, which gave First Guardian its tick of approval.
